Parliament’s Committee on Tourism, Trade and Industry has learnt that Trade ministry has failed to put in place a sugar board to help regulate the industry.
“We are investigating the regulations in the sugar cane. Farmers tell us that 5 percent is deducted from them and we want to establish who’s issuing licenses with no board,” added Trade Committee chairperson, Mwine Mpaka.
While speaking to the media at parliament, Mpaka told journalists that they were disturbed that the Trade ministry has no board and it’s the one carrying out the mandate of issuing licenses which is wrong.
Mpaka said as a committee they will be interfacing with the farmers and understand the issue so that they come up with a complete report to the house.
On November 2, 2022, the MP Nakifuma county, Fred Ssimbwa raised a matter of national importance on the floor of parliament over the escalating sugar prices versus sugarcane prices.
Speaker of Parliament reffered the matter to the Trade committee for further study and recommendations.
Ssimbwa stated that over the last six months , the price of a 50kg bag of sugar had averagely escalated from Shs 150,000 in May to Shs 165,000 in June 2022, shs 185,000 in Septemer, Shs 195,000 in October and currently averagely Shs 215,000.
Ssimbwa , however said the sugar cane farmers are not benefiting from the increase in the sugar prices which is largely a regulatory issue stemming from non- operationalization of the sugar Act 2020 coupled with other challenges faced by the sugarcane farmers.
The Chairperson of Uganda Sugar Manfactures Association Mr Jim Mwine Kabeho acknowldeged that indeed sugar prices shot up from May to November 2022.
Mwine explained that the genesis of escalation in the uganda sugar industry is lack of order and stability. The existing sugar mills have expanded their capacities and new mills licensed; however, except for a few mills like Kakira, Kinyara and SCOUL, this process is not synchronized with sugar cane developed either through miller owned sugar estates or development of enough out- growers to gurantee sugarcane supply to these mills.
“Licensing new sugar mills in areas where sugar mills are already established, without licensing a targeted sugar cane development program, is a recipe for disaster. It leads to increasing sugar production,” added Kabeho.
Parliament passed the Sugar Bill, 2020 which was later assented into law. The Sugar Act 2020 commenced on 28th August 2020. The object of the Act is to provide for the development, regulation and promotion of the sugar industry and provide for the establishment of the sugar board.
Section 3 of the Sugar ACT 2020 establishes the Uganda Sugar Board and section 4 (2) mandates the Minister to appoint members of the Board, however this has never been done. This is one of the biggest causes of sugarcane price fluctuations because it’s the responsibility of the Board to decide the percentage “D” in the sugar cane price equation as per schedule 3 of the Act.
According to Ssimbwa, the Board has many functions such as arbitrate and mediate disputes between parties in the sugar industry, review, on a regular basis, the problems and prospects of the sugar industry services, lobby for incentives for the benefit of the sugar industry and provide advisory services to parties in the sugar industry among others.
These would be the solutions to most of the challenges faced by the farmers but cannot be affected due to the absence of the board.